Review and Update of the Policy and Performance Standards on Social and
Environmental Sustainability and Policy on Disclosure of Information
Consultations’ report: New Delhi, India, June 25, 2010
Location of Consultation: New Delhi, India
Date: June 25, 2010
Participants: See annex.
Consultation Process: The consultation included: (i) brief introduction of all participants and
the expectations of the process, (ii) overview of the Performance Standards, (iii) plenary on the
key proposed changes and cross-cutting themes, (iv) breakout group discussion #1 and report
back to plenary on key issues, (iv) Disclosure Policy overview, together with CAO
representative, (v) breakout group discussion #2 to drill down on topics, (vi) management
responses and next steps, and (vii) closing comments.
Note: This interim report from the consultation workshop summarizes key points and
suggestions made by the participants. It does not contain detailed responses from IFC. The
issues are under review and discussion, and IFC is preparing a summary of responses to key
issues related to these and other topics during the second half of September 2010. These
will be posted to the www.ifc.org/policyreview website.
IFC wishes to thank all the participants in this consultation as well as others who have
contributed to the consultation process on IFC’s revised Sustainability Framework. While we
have tried to be as comprehensive and accurate as possible in capturing participants’ views
and observations, there may be errors or omissions in the summary. We welcome
corrections.
Key Themes, Recommendations, and Questions Raised
Climate Change/Ecosystem Services
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IFC should review its lending policy on climate change and energy efficiency. IFC should
take a leading role in incentivizing development of renewable energy at the policy and
technology levels.
IFC should allow for gradual improvement on GHG emissions depending on the context of
where the company operates and should provide a standard approach to local
benchmarking on GHGs.
Climate change should be factored into project design, at the project scoping phase.
Projects in sensitive ecosystems should not be funded by IFC.
IFC should participate more heavily in biodiversity monitoring. Consider incorporating
biodiversity registers in each project. If one cannot assign a value to natural resources, it’s
difficult to measure the project’s impact on those resources.
Most high-profile studies on biodiversity focus on economic impacts – increase in
employment, etc. Ecosystem services have not been but should be assessed. There are
ways to quantify the value of natural resources, including forest costs.
Some 30% of the poor in India are dependent on natural resources. IFC should consider the
economic impact of natural capital depletion and should consider expanding the livelihood
assessment to include all natural resources in the area.
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IFC’s client companies can play a role in helping the community build resilience to climate
change. How does IFC help clients address adaptation issues?
Companies with financial resources may have the capacity to pay for the rights to access
natural resources – those companies that can afford to may continue to impact the
environment.
IFC should focus more on the issue of waste management.
Some definitions in IFC’s Sustainability Framework conflict with IUCN, WWF definitions on
guidelines for eco-projects.
There is a need to understand supply chain risks at the beginning of the project. Typically
the issue is averted through outsourcing and passing on the responsibility.
IFC should clarify how many links / levels into the supply chain should be reviewed.
Water is a low cost but least valued resource. How is IFC addressing this?
Financial Intermediaries (FIs)
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What is IFC’s role and responsibility for money that is on-lent to clients of financial
intermediaries (FIs)?
FIs are identifying the risk of their subprojects – there is a need for external monitoring of
how FIs classify those risks.
IFC should have FI-specific DOTS indicators.
Engagement/Disclosure/Consultation
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Consent versus consultation. If IFC goes with a consent-based approach, external
stakeholders should be involved in determining the definition of consent.
Consider ADB/EBRD’s approach to consent.
What is the appropriate percentage of community members that need to be consulted to
reach consent? Consent is difficult to operationalize. For instance, it’s difficult to determine
whether stakeholders are engaged in the process, and the make-up of the
community/community membership may change over the life of the project.
Local communities need to be better informed about projects throughout the project cycle.
Local communities should get monthly project implementation updates. The updates should
be in a language and format that can be easily understood by local communities.
It’s important for IFC to keep current on how the project is being implemented and how the
community is engaged throughout the life of the project.
IFC should increase emphasis on stakeholder involvement, i.e. help in monitoring high-risk
projects.
Much reporting is required before a project starts; however, there is little to no technical
assistance on reporting provided by IFC. Also, there needs to be increased focus on
reporting and disclosure throughout the investment process.
External stakeholders are not aware of how disclosure is done.
DOTS information should be shared during the project lifecycle – not just after the project.
The Sustainability Framework should be translated into Hindi.
Suggest a shift to 120 days on disclosure.
Consider differences in the sustainability of IFC clients versus sustainability of stakeholders,
including local communities. Institutional arrangements between communities and clients
are important can help with capacity building and to empower local communities.
Is the term CAO “ombudsman” considered gender insensitive?
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There is more clarity in the revised Performance Standards – some jargon was removed.
Consider disclosing loan agreements where land issues are involved.
Human Rights/Labor
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Social impact assessments should address human rights. There should not be separate
human rights impact assessments.
There may be resistance from certain sectors to do human rights assessments. Even best
intentioned companies may be concerned about how far the assessment will go.
IFC should consider whether it should do business in sectors that engage in child labor.
What is the definition of child (age) when it comes to child labor?
How should clients address the need of migrant workers to care for their children during
work hours?
Legislation is helpful but challenges exist in working conditions of migrant labor in factories.
Divergent thinking on boundaries for employers on issues of abuse that come to their
attention, such as domestic violence. Guidance is needed on how far client companies
should go to address these issues.
IFC should offer Technical Assistance to sectors most vulnerable to labor/supply chain
issues.
Sustainability Framework Review and Update General/Process
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Attendees were notified of this consultation only 10 days prior to the event. More advance
notice is needed to adequately prepare.
There should be additional regional consultations on the Sustainability Framework Review
and Update.
IFC should consider a Performance Standard on compliance that applies to all projects.
Has there been experience where IFC clients lose competitive advantage from complying
with the Performance Standards?
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ANNEX: Participants – New Delhi
Amit Vatsyayan
Private Sector Adviser-South Asia, Oxfam GB
Ashok Emani
Senior Vice President, IDFC / IIF
Bhavna Prasad
Head of Business and Industry, WWF-India
Debi Goenka
Executive Trustee, Conservation Action Trust
Dr K.S.M.Rao
Director, Ramky Enviro Engineers Ltd.
K C Malhotra
Training Programme Developer, Uttar Pradesh Forest Departement and Tripura Forest Departement
Khadga Bahadur Bisht
Project Manager, Himal Power Limited
Mainak Hazra
Director, SENES Consultants India Pvt. Ltd.
Mangesh Dakhore
Head - Environmental & Social Risk Management, SENES Consultants
Mangesh Pathak
Principal, Ambit Pragma Ventured Pvt Ltd
MAYANK CHOUDHARY
Associate Director, Macquarie Capital Advisers (India) Pvt. Ltd.
Md. Eleash Mridha
Director, Pran Group
Menaka Guruswamy
Attorney, Supreme Court of India
N. Sateesh Babu
Vice president-Environment, IL&FS Environment Group
Neena Singh
Partner, ERM India Pvt Ltd
Pearl Tiwari
Vice President (CSR), Ambuja Cements Limited
R.R. Nair
Executive Director, Lanco Anpara Power Limited
Raman Mehta
Functional Manager, Policy, ActionAid India
Ramananda Wangkheirakpam
Coordinator, Forum for Indigenous Perspectives and Action
Ramesh Chand Swarankar
Resettlement & Social Development Officer, Asian Development Bank
Ronak Shah
Development Professional, Seva Mandir
S.R. HUSSAIN
Senior Manager - Group CSR & Corporate EHS, Amalgamated Bean Coffee Trading Co. Ltd
Sadananda Poojary
Company Secretary, Amalgamated Bean Coffee Trading Co. Ltd
Sanjay Prasad Gairola
AGM (EHS&S), Allain Duhangan Hydroelectric Project
Shivesh Sinha
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ANNEX: Participants – New Delhi
Development Director - Asia; Chairmam LUMPL, Lafarge Asia Sdn Bhd
SUNAYNA KALRA
Dy. General Manager, HOLTEC CONSULTING PVT. LTD.
Surya Man Shakya
Sr. Manager, Environment, SN/Power Holding Singapore Pte. Ltd.
Joe Athialy
Coordinator for South Asia, Bank Information Center
Himanshu Thakkar
Coordinator, South Asia Network on Dams, Rivers and People
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